Sensemaking
#4Key Findings
New Zealand falls into the sample’s top group (rank 4) in the category of sensemaking.
No centralized unit for strategic foresight and anticipatory innovation exists. However, the Public Service Act of 2020 requires government departments to produce long-term insights briefings every three years, exploring future trends and risks. Other government organizations also incorporate strategic foresight in their work.
While there is no legal mandate for regulatory impact assessments (RIAs), policymaking frameworks strongly encourage them. The Treasury’s guidelines outline a process that includes the analysis of economic, social and environmental impacts, as well as the involvement of stakeholders.
Sustainability reviews are not legally required, but are encouraged through the “triple bottom line” approach to RIAs. Ex post evaluation is also not mandatory, and there is no established methodology, but the OECD considers the evaluation regime to be more robust than the OECD average.
No centralized unit for strategic foresight and anticipatory innovation exists. However, the Public Service Act of 2020 requires government departments to produce long-term insights briefings every three years, exploring future trends and risks. Other government organizations also incorporate strategic foresight in their work.
While there is no legal mandate for regulatory impact assessments (RIAs), policymaking frameworks strongly encourage them. The Treasury’s guidelines outline a process that includes the analysis of economic, social and environmental impacts, as well as the involvement of stakeholders.
Sustainability reviews are not legally required, but are encouraged through the “triple bottom line” approach to RIAs. Ex post evaluation is also not mandatory, and there is no established methodology, but the OECD considers the evaluation regime to be more robust than the OECD average.
Graph View
Graph View
To what extent can the central government foster the capacity for strategic foresight and anticipatory innovation within its organization?
10
9
9
The central government can foster the capacity for strategic foresight and anticipatory innovation within its organization.
8
7
6
7
6
Most of the time, the central government can foster the capacity for strategic foresight and anticipatory innovation within its organization.
5
4
3
4
3
The central government is rarely capable of fostering the capacity for strategic foresight and anticipatory innovation within its organization.
2
1
1
The central government is not capable of fostering the capacity for strategic foresight and anticipatory innovation within its organization.
New Zealand does not have a centralized unit solely dedicated to strategic foresight and anticipatory innovation at the national level. However, the Public Service Act of 2020 requires government departments, independently of ministers, to produce a long-term insights briefing (LTIB) at least once every three years. These LTIBs should explore future trends, risks and opportunities. They are expected to provide information and impartial analysis, as well as policy options for responding to risks and seizing opportunities.
In addition, other government organizations incorporate elements of strategic foresight and innovation in their work. The Productivity Commission conducts research and inquiry into topics related to New Zealand’s productivity and economic performance, often considering future trends and scenarios. The Ministry of Business, Innovation and Employment (MBIE) oversees various programs and initiatives related to innovation, including science and innovation funding, and policies that encourage research and development. The Department of Internal Affairs plays a significant role in leading and supporting government initiatives related to open government, digital transformation and information management. The government chief digital officer is also tasked with driving digital transformation across government agencies.
Moreover, New Zealand has a network of chief science advisers, known as the Chief Science Adviser Forum, appointed to individual departments but forming part of a cohort that can work together on overall government priorities. Among other roles, they ensure that government departments, both individually and collectively, improve the evidence base underpinning their policy development and advice to ministers.
Citations:
Office of the Prime Minister’s Chief Science Adviser. n.d. “Chief Science Adviser Forum.” https://www.pmcsa.ac.nz/who-we-are/chief-science-advisor-forum/
In addition, other government organizations incorporate elements of strategic foresight and innovation in their work. The Productivity Commission conducts research and inquiry into topics related to New Zealand’s productivity and economic performance, often considering future trends and scenarios. The Ministry of Business, Innovation and Employment (MBIE) oversees various programs and initiatives related to innovation, including science and innovation funding, and policies that encourage research and development. The Department of Internal Affairs plays a significant role in leading and supporting government initiatives related to open government, digital transformation and information management. The government chief digital officer is also tasked with driving digital transformation across government agencies.
Moreover, New Zealand has a network of chief science advisers, known as the Chief Science Adviser Forum, appointed to individual departments but forming part of a cohort that can work together on overall government priorities. Among other roles, they ensure that government departments, both individually and collectively, improve the evidence base underpinning their policy development and advice to ministers.
Citations:
Office of the Prime Minister’s Chief Science Adviser. n.d. “Chief Science Adviser Forum.” https://www.pmcsa.ac.nz/who-we-are/chief-science-advisor-forum/
Graph View
To what extent does the government conduct high-quality impact assessments to evaluate the potential effects of prepared legislation before implementation?
10
9
9
The government draws on high-quality RIAs to assess the potential impact of prepared legislation before implementation.
8
7
6
7
6
In most cases, the government draws on high-quality RIAs to assess the potential impact of prepared legislation before implementation.
5
4
3
4
3
The government rarely draws on high-quality RIAs to assess the potential impact of prepared legislation before implementation.
2
1
1
The government does not draw on high-quality RIAs to assess the potential impact of prepared legislation before implementation.
The New Zealand government places significant emphasis on conducting impact assessments to evaluate the potential effects of proposed legislation. While there is no specific legal requirement mandating regulatory impact assessments (RIAs) for all new legislation, policymaking frameworks strongly encourage their use as a standard practice. Guidance for government departments and agencies is provided, in particular, by the Cabinet Manual (Department of the Prime Minister and the Cabinet 2020) and the Treasury’s regulatory management guidelines (The Treasury 2017). These documents suggest that RIAs should be conducted for significant policy proposals to comprehensively assess their potential impacts.
The Treasury’s RIA guidelines outline a structured process for conducting RIAs, emphasizing the need to analyze the economic, environmental, social and regulatory impacts of proposed policies or regulations. The guidelines also recommend involving stakeholders to gather empirical information, insights and perspectives on how proposed regulatory changes might affect them. Moreover, the Treasury guidelines state that the results of RIAs should be made available to the public.
A 2021 OECD report ranks New Zealand’s RIA process above the OECD average, highlighting stakeholder consultation and the publication of impact assessments online as particular strengths. However, the report also notes that RIA practices would benefit from a more systematic approach to notifying stakeholders of upcoming opportunities to contribute to regulatory proposals (OECD 2021).
Assessing the direct impact of regulatory impact assessments on legislative changes is challenging, as these changes are not explicitly documented or systematically tracked. Although RIAs play a crucial role in the policymaking process, the extent to which they lead to legislative modifications may depend on various factors, such as whether RIAs are covered by major news outlets. For instance, the negative expert opinions expressed in the RIA of Labour’s Three Waters proposal were widely reported in the media (e.g., Coughlan 2022), potentially contributing to negative public opinion and prompting the government to significantly revise its proposal. However, there have been instances of new policy programs being introduced without an RIA.
Citations:
Coughlan, T. 2022. “Three Waters: Officials warn water bills could increase ‘significantly’ without regulation.” New Zealand Herald, December 12. https://www.nzherald.co.nz/nz/politics/three-waters-officials-warn-water-bills-could-increase-significantly-without-regulation/X6DMKCH7KNCZNBJLNJBCVJKYYI/
Department of the Prime Minister and the Cabinet. 2020. “Impact Analysis.” https://www.dpmc.govt.nz/publications/impact-analysis
OECD. 2021. “New Zealand: Indicators of Regulatory Policy and Governance.” https://www.oecd.org/gov/regulatory-policy/new-zealand-country-profile-regulatory-policy-2021.pdf
The Treasury. 2017. “Regulation.” https://www.treasury.govt.nz/information-and-services/regulation
The Treasury’s RIA guidelines outline a structured process for conducting RIAs, emphasizing the need to analyze the economic, environmental, social and regulatory impacts of proposed policies or regulations. The guidelines also recommend involving stakeholders to gather empirical information, insights and perspectives on how proposed regulatory changes might affect them. Moreover, the Treasury guidelines state that the results of RIAs should be made available to the public.
A 2021 OECD report ranks New Zealand’s RIA process above the OECD average, highlighting stakeholder consultation and the publication of impact assessments online as particular strengths. However, the report also notes that RIA practices would benefit from a more systematic approach to notifying stakeholders of upcoming opportunities to contribute to regulatory proposals (OECD 2021).
Assessing the direct impact of regulatory impact assessments on legislative changes is challenging, as these changes are not explicitly documented or systematically tracked. Although RIAs play a crucial role in the policymaking process, the extent to which they lead to legislative modifications may depend on various factors, such as whether RIAs are covered by major news outlets. For instance, the negative expert opinions expressed in the RIA of Labour’s Three Waters proposal were widely reported in the media (e.g., Coughlan 2022), potentially contributing to negative public opinion and prompting the government to significantly revise its proposal. However, there have been instances of new policy programs being introduced without an RIA.
Citations:
Coughlan, T. 2022. “Three Waters: Officials warn water bills could increase ‘significantly’ without regulation.” New Zealand Herald, December 12. https://www.nzherald.co.nz/nz/politics/three-waters-officials-warn-water-bills-could-increase-significantly-without-regulation/X6DMKCH7KNCZNBJLNJBCVJKYYI/
Department of the Prime Minister and the Cabinet. 2020. “Impact Analysis.” https://www.dpmc.govt.nz/publications/impact-analysis
OECD. 2021. “New Zealand: Indicators of Regulatory Policy and Governance.” https://www.oecd.org/gov/regulatory-policy/new-zealand-country-profile-regulatory-policy-2021.pdf
The Treasury. 2017. “Regulation.” https://www.treasury.govt.nz/information-and-services/regulation
To what extent does the government effectively incorporate sustainability assessments within the framework of RIAs?
10
9
9
High-quality sustainability assessments are incorporated within regulatory impact assessments.
8
7
6
7
6
High-quality sustainability assessments are, for the most part, incorporated within regulatory impact assessments.
5
4
3
4
3
High-quality sustainability assessments are rarely incorporated within regulatory impact assessments.
2
1
1
Sustainability assessments are not incorporated within regulatory impact assessments.
New Zealand has adopted the United Nations’ Sustainable Development Goals (SDGs) and integrated them into its policy framework. Although there is no single, comprehensive national strategy solely dedicated to sustainable development explicitly based on the SDGs, the government has aligned its policymaking with these goals and undertaken various initiatives to achieve them. For example, Statistics New Zealand has developed Indicators Aotearoa New Zealand – Ngā Tūtohu Aotearoa, a set of statistical indicators focusing on sustainable development and the need to report on the SDGs (Stats NZ 2019). Another example is the Living Standards Framework (LSF) developed by the Treasury, which is designed to prompt thinking about the sustainability implications of policy (Treasury 2022).
There is no legal requirement explicitly mandating sustainability checks as part of RIAs. Nevertheless, cabinet and Treasury guidelines strongly encourage the consideration of sustainability factors in the RIA process. In particular, these guidelines advocate for a “triple bottom line” approach, emphasizing the consideration of economic, social and environmental impacts.
In addition, broader legal frameworks often encourage government agencies to consider sustainability factors as an integral part of their regulatory impact assessments. For example, the Resource Management Act requires environmental considerations in planning and decision-making processes.
Citations:
Stats NZ. 2019. “Indicators Aotearoa New Zealand – Ngā Tūtohu Aotearoa.” https://www.stats.govt.nz/indicators-and-snapshots/indicators-aotearoa-new-zealand-nga-tutohu-aotearoa
The Treasury. 2022. “Our Living Standards Framework.” https://www.treasury.govt.nz/information-and-services/nz-economy/higher-living-standards/our-living-standards-framework
There is no legal requirement explicitly mandating sustainability checks as part of RIAs. Nevertheless, cabinet and Treasury guidelines strongly encourage the consideration of sustainability factors in the RIA process. In particular, these guidelines advocate for a “triple bottom line” approach, emphasizing the consideration of economic, social and environmental impacts.
In addition, broader legal frameworks often encourage government agencies to consider sustainability factors as an integral part of their regulatory impact assessments. For example, the Resource Management Act requires environmental considerations in planning and decision-making processes.
Citations:
Stats NZ. 2019. “Indicators Aotearoa New Zealand – Ngā Tūtohu Aotearoa.” https://www.stats.govt.nz/indicators-and-snapshots/indicators-aotearoa-new-zealand-nga-tutohu-aotearoa
The Treasury. 2022. “Our Living Standards Framework.” https://www.treasury.govt.nz/information-and-services/nz-economy/higher-living-standards/our-living-standards-framework
To what extent do government ministries utilize ex post evaluations to improve existing policies?
10
9
9
High-quality ex post evaluations serve as the basis for making adjustments to public policies.
8
7
6
7
6
High-quality ex post evaluations frequently serve as the basis for making adjustments to public policies.
5
4
3
4
3
High-quality ex post evaluations rarely serve as the basis for making adjustments to public policies.
2
1
1
High-quality ex post evaluations are not utilized to make adjustments to public policies.
There is no specific law mandating regular ex post evaluations. Nevertheless, principles and guidelines encourage and support the use of evaluations. For example, the Treasury’s Better Public Services program, launched in 2012, emphasizes a results-focused approach to public service delivery and encourages agencies to use data and evidence to evaluate the effectiveness of their programs and policies (The Treasury 2015). Another example is the New Zealand Productivity Commission – an independent Crown entity – which often conducts inquiries and research into policy and regulatory issues, assessing their effectiveness and efficiency.
The OECD also notes that ex post evaluation is not mandatory and that there is no established methodology for conducting ex post evaluations, but it still considers New Zealand’s ex post evaluation regime to be more robust than the OECD average (OECD 2015).
Assessing the extent to which the results of ex post evaluations lead to changes in existing legislation or inform the development of new legislation is very difficult. In theory, ex post evaluations can influence policy changes or the design of new policies in a number of ways – for example, by feeding into periodic policy reviews or RIAs for proposed new legislation.
Citations:
OECD. 2015. “OECD Regulatory Policy Outlook: New Zealand.” https://web-archive.oecd.org/2015-11-23/376481-New%20Zealand-web.pdf
The Treasury. 2015. “Better Public Services.” https://www.treasury.govt.nz/information-and-services/state-sector-leadership/cross-agency-initiatives/better-public-services
The OECD also notes that ex post evaluation is not mandatory and that there is no established methodology for conducting ex post evaluations, but it still considers New Zealand’s ex post evaluation regime to be more robust than the OECD average (OECD 2015).
Assessing the extent to which the results of ex post evaluations lead to changes in existing legislation or inform the development of new legislation is very difficult. In theory, ex post evaluations can influence policy changes or the design of new policies in a number of ways – for example, by feeding into periodic policy reviews or RIAs for proposed new legislation.
Citations:
OECD. 2015. “OECD Regulatory Policy Outlook: New Zealand.” https://web-archive.oecd.org/2015-11-23/376481-New%20Zealand-web.pdf
The Treasury. 2015. “Better Public Services.” https://www.treasury.govt.nz/information-and-services/state-sector-leadership/cross-agency-initiatives/better-public-services